More hiring optimism hints at supply outstripping demand

More than half of Britain's employers plan to expand their workforce during the second half of this year. But many are also concerned that there is not enough supply to meet demand

A survey of 100 UK employers by Management Recruiters International (MRI) found that 57 per cent planned to increase their overall workforce, with most saying that an improving economy was stimulating the growth.

The figures broadly tally with other recent research from the Chartered Institute of Personnel and Development suggesting that eight out of ten employers planned to take on staff in the third quarter of the year with six out of ten increasing their overall head count.

July's Reed Recruitment Index found that the number of firms planning to take on staff during the third quarter of the year has grown 10 per cent on the second quarter, with four out of ten firms planning to expand their workforces.

According to MRI, almost half of firms (45 per cent) said they anticipated candidate shortages over the next six months. The professional / managerial (43 per cent) and technical (40 per cent) skills areas were those expected to cause the biggest problems.

The survey also reveals that companies are also making greater efforts to retain their employees. Among the inducements on offer are flexitime arrangements (27 per cent), working from home (26 per cent), outsourcing (20 per cent), job sharing (16 per cent) and reducing the number of hours worked (10 per cent).

MRI’s Allen Salikof: said: "As businesses prepare for the second part of the year, it is clear that the majority have a positive outlook on both the economy and recruitment. However, business is driven by the middle management layer and this survey demonstrates that there are perceived shortages in this area."

In the United States, MRI found a similar story, with 58 per cent of firms planning to make new hires, up more than 10 per cent on first half of 2004. Another 37 per cent planned to maintain their current head count, with fewer than five per cent planning to shed staff.

Elsewhere, 54 per cent of Australian employers, 50 per cent of German employers and 48 per cent of Japanese employers planned to hire. But only 26 per cent of Portuguese companies expressed such optimism.